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> Why couldn't they be on par with the rise in productivity? Because wages are tied to supply and demand, not productivity. Increased productivity will rather

> Why couldn't they be on par with the rise in productivity? Because wages are tied to supply and demand, not productivity. Increased productivity will rather lower wages. > Yes, quite frequently. Here's an article with numbers and a graph Same fallacy with the percentages: The top 1% clearly got their wages raised (CEOs etc), but in broader terms it doesn't matter much, because it's only 1%. In absolute terms, the sums are not that large relative to the sum of the wages of everyone else. It's a psychological problem, because people don't like income inequality, but economically, it doesn't make much of a difference. This is where the left steps in to gain political capital from a non-issue.

AstralStorm 9y ago
People are still using averages to talk about heavy tailed exponential - like distributions such as income distribution? Please... In fact the super rich getting richer will skew the average disproportionately. But not the median. So your point is as invalid as the use of the average for income in the first place.
- galacticpony2 9y ago
  Well, those 1% could in theory have 99.99% of all income. So the justification that "because it's only 1%" (of people) is wrong. In fact, neither the median nor the average supports my point, but the share of the income total of those 1% relative to the sum of all incomes.
crdoconnor 9y ago
"It's a psychological problem, because people don't like income inequality, but economically, it doesn't make much of a difference." Did you not notice the sharp inflation-adjusted increase in rents and house prices over the last 20 years? That was directly a result of rising income and wealth inequality.
- galacticpony2 9y ago
  First of all, I'm talking about the inequality of income between the super-high-earners (1%) and the rest. Those people are not the ones pricing everyone else out of housing. Secondly, it's not true that rent/house prices increased sharply everywhere, nor is it entirely due to income inequality between high-earners and low-earners. For one, we had and have a lot of real estate speculation (a correction of which we experienced in 2007) but we also have policies and regulations in place that ensure the market can not provide for affordable housing. What prevents construction of an apartment highrise in the middle of San Francisco? It ain't neoliberalism, that's for sure...
  - crdoconnor 9y ago
    >First of all, I'm talking about the inequality of income between the super-high-earners (1%) and the rest. Those people are not the ones pricing everyone else out of housing. >For one, we had and have a lot of real estate speculation Who did you think was speculating?
lawpoop 9y ago
> Because wages are tied to supply and demand, not productivity. Increased productivity will rather lower wages. You ever notice how right-wingers dismiss economic statistics quasi-scholastic talking points, and never show you numbers?
- galacticpony2 9y ago
  I'm not a right-winger and I'm not dismissing the statistic. The statistic is correct. The question was "why aren't wages tied to productivity?". The answer is, an employer will only pay as much as necessary, even if workers become more productive. That's just common sense. An increase in productivity correlates with an increase in wages only if market demand supports it. An increase in productivity combined with stagnant demand will reduce the amount of labor required, increasing the supply of labor, lowering its price. Is that not obvious?
  - lawpoop 9y ago
    Make with the numbers.

AstralStorm 9y ago

People are still using averages to talk about heavy tailed exponential - like distributions such as income distribution? Please... In fact the super rich getting richer will skew the average disproportionately. But not the median. So your point is as invalid as the use of the average for income in the first place.

galacticpony2 9y ago
Well, those 1% could in theory have 99.99% of all income. So the justification that "because it's only 1%" (of people) is wrong. In fact, neither the median nor the average supports my point, but the share of the income total of those 1% relative to the sum of all incomes.

crdoconnor 9y ago

"It's a psychological problem, because people don't like income inequality, but economically, it doesn't make much of a difference." Did you not notice the sharp inflation-adjusted increase in rents and house prices over the last 20 years? That was directly a result of rising income and wealth inequality.

galacticpony2 9y ago
First of all, I'm talking about the inequality of income between the super-high-earners (1%) and the rest. Those people are not the ones pricing everyone else out of housing. Secondly, it's not true that rent/house prices increased sharply everywhere, nor is it entirely due to income inequality between high-earners and low-earners. For one, we had and have a lot of real estate speculation (a correction of which we experienced in 2007) but we also have policies and regulations in place that ensure the market can not provide for affordable housing. What prevents construction of an apartment highrise in the middle of San Francisco? It ain't neoliberalism, that's for sure...
- crdoconnor 9y ago
  >First of all, I'm talking about the inequality of income between the super-high-earners (1%) and the rest. Those people are not the ones pricing everyone else out of housing. >For one, we had and have a lot of real estate speculation Who did you think was speculating?

lawpoop 9y ago

> Because wages are tied to supply and demand, not productivity. Increased productivity will rather lower wages. You ever notice how right-wingers dismiss economic statistics quasi-scholastic talking points, and never show you numbers?

galacticpony2 9y ago
I'm not a right-winger and I'm not dismissing the statistic. The statistic is correct. The question was "why aren't wages tied to productivity?". The answer is, an employer will only pay as much as necessary, even if workers become more productive. That's just common sense. An increase in productivity correlates with an increase in wages only if market demand supports it. An increase in productivity combined with stagnant demand will reduce the amount of labor required, increasing the supply of labor, lowering its price. Is that not obvious?
- lawpoop 9y ago
  Make with the numbers.